LATAM Airlines to suspend Venezuela flights

SANTIAGO May 30 (Reuters) - Latin America's largest
airline, Chile-based LATAM Airlines, said on Monday it
would suspend its flights to Venezuela due to the "economic
scenario", following a similar decision by Lufthansa over the
weekend.

"Owing to the current complex macroeconomic scenario in the
region, LATAM Airlines has announced adjustments to its
destination network... it will suspend temporarily and for an
undefined time its operations to Caracas airport," the company
said in a statement.

On Saturday, German airline Deutsche Lufthansa AG
also said it was halting Caracas-bound operations. It is owed
more than $100 million in ticket revenue, it said.

International airlines have for years struggled to
repatriate billions of dollars in revenue held in Venezuela's
local bolivar currency, as the cash-strapped government failed
to convert it to hard currency amid tight exchange controls.

This has prompted many airlines to limit service to
Venezuela and require that passengers pay fares in hard
currency.

But a deep recession and rocketing inflation has put foreign
travel out of the reach of many citizens.

Economic woes in the region are also spurring LATAM to shift
flight routes away from struggling areas like Brazil and
Venezuela toward places like still-growing Peru.

Flights between Sao Paulo and Caracas will stop at the end
of May, and those from Santiago and Lima will end in July, the
company said, adding that it would work to restart operations
"as soon as conditions permitted".

Tony Tyler, the chief executive of airline industry body
IATA, had warned in March that the few remaining airlines still
operating in Venezuela "may throw in the towel".

"You can sense the frustration, some have said to us
privately that they are thinking seriously about whether they
can afford to keep these operations going," he said on the
sidelines of an airline conference in Chilean capital Santiago.
(Reporting by Rosalba O'Brien; Editing by David Gregorio)